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Augmented and Unconstrained: revisiting the Regional Knowledge Production Function

Listed author(s):
  • Sylvie Charlot

    (GAEL UMR 1215, INRA; University of Grenoble, France.)

  • Riccardo Crescenzi

    ()

    (London School of Economics, Spatial Economics Research Centre, UK.)

  • Antonio Musolesi

    ()

    (Dept. of Economics and Management. University of Ferrara, Italy.)

By adopting a semiparametric approach, the 'traditional' regional knowledge production function is developed in three complementary directions. First, the model is augmented with region-speci c time trends in order to account for endogeneity due to selection on unobservables. Second, the nonparametric part of the model relaxes the standard assumptions of linearity and additivity regarding the effect of R&D and human capital. Finally, the assumption of homogeneity in the effects of R&D and human capital is also relaxed by explicitly accounting for the differences between developed and lagging regions. The analysis of the genesis of innovation in the regions of the European Union unveils nonlinearities and threshold effects, complex interactions, and shadows effects that cannot be uncovered by standard parametric formulations.

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File URL: http://www.sustainability-seeds.org/papers/RePec/srt/wpaper/2414.pdf
File Function: First version, 2014
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File URL: http://www.sustainability-seeds.org/papers/RePec/srt/wpaper/2414.pdf
File Function: Revised version, 2014
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Paper provided by SEEDS, Sustainability Environmental Economics and Dynamics Studies in its series SEEDS Working Papers with number 2414.

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Length: 46 pages
Date of creation: Aug 2014
Date of revision: Aug 2014
Handle: RePEc:srt:wpaper:2414
Contact details of provider: Web page: http://www.sustainability-seeds.org

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